Bloomingdale wants to pull the plug on special tax

Bloomingdale trustees are continuing to reduce a telecommunications tax that was enacted eight years ago to address a large budget shortfall.

The village board this week agreed to lower the tax to 1 percent from 3 percent. It's the second time in two years they voted to reduce the fee.

Residents will see the latest decrease on their phone bills starting Jan. 1.

"The purpose for the telecommunications tax doesn't exists anymore," Village President Franco Coladipietro said Thursday.

Bloomingdale originally created the tax in 2010 to address what was then a $1.7 million shortfall in the village's budget. At the time, several factors - such as falling sales tax revenues and flat property tax income - were causing a disparity between expenses and revenues.

The tax applies to the gross amount of bills for mobile phones, landlines, internet and other services. It originally was 5 percent.

Village Administrator Peter Scalera says Bloomingdale has been able to reduce the tax in recent years because the village's financial situation has improved.

Scalera said that was achieved because the village found ways to save money. For example, he said, officials streamlined service delivery methods and did better planning of equipment purchases and special projects.

Coladipietro added the village has consolidated top administration positions and reduced head count. He said the economy also has improved.

Therefore, he said, it doesn't make sense to keep the telecommunications tax, even though it's generating roughly $325,000 annually for the village.

"We wanted to eliminate the tax in phases as we were able to realign our revenue and expenses going forward," Coladipietro said.

Bloomingdale's multiyear phaseout plan calls for another reduction - and the elimination of the tax - in January 2021.

As for the 2-percentage-point reduction that takes effect Jan. 1, it's expected to save the average Bloomingdale resident $12 a year.